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Population ageing, income growth and CO 2 emission

Population ageing, income growth and CO 2 emission Purpose – The purpose of this paper is to attempts to explore the relationship between population ageing, income growth and CO 2 emission in 25 high-income Organization for Economic Cooperation and Development (OECD) countries in the framework of environmental Kuznets curve (EKC). Design/methodology/approach – Following Zagheni (2011) and using a relatively new cointegration technique and fully modified ordinary least square in a panel data over 1980-2009 the empirical results find evidence of inverted-U shaped EKC in these OECD countries. Findings – The empirical results demonstrate that per capita CO 2 emission (PCCO 2 ) increases initially with economic growth; however, after reaching a per capita income level of US$ 24,657 it starts falling. With regard to ageing, the cointegrating vector indicates that a one percent increase in the share of aged population will reduce PCCO 2 by 1.55 percent in the long run. Originality/value – This is one of the first studies that examine the effect of population ageing on CO 2 emission in a panel setting. The paper consider the cross-sectional dependence and use unit root test suitable for cross-sectional-dependent variables. The paper also examine short-run and long-run dynamics of EKC with panel cointegration and panel error correction methods. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Economic Studies Emerald Publishing

Population ageing, income growth and CO 2 emission

Hassan, Kamrul; Salim, Ruhul
Journal of Economic Studies , Volume 42 (1): 14 – Jan 12, 2015
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References (54)

Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
0144-3585
DOI
10.1108/JES-04-2013-0046
Publisher site
See Article on Publisher Site

Abstract

Purpose – The purpose of this paper is to attempts to explore the relationship between population ageing, income growth and CO 2 emission in 25 high-income Organization for Economic Cooperation and Development (OECD) countries in the framework of environmental Kuznets curve (EKC). Design/methodology/approach – Following Zagheni (2011) and using a relatively new cointegration technique and fully modified ordinary least square in a panel data over 1980-2009 the empirical results find evidence of inverted-U shaped EKC in these OECD countries. Findings – The empirical results demonstrate that per capita CO 2 emission (PCCO 2 ) increases initially with economic growth; however, after reaching a per capita income level of US$ 24,657 it starts falling. With regard to ageing, the cointegrating vector indicates that a one percent increase in the share of aged population will reduce PCCO 2 by 1.55 percent in the long run. Originality/value – This is one of the first studies that examine the effect of population ageing on CO 2 emission in a panel setting. The paper consider the cross-sectional dependence and use unit root test suitable for cross-sectional-dependent variables. The paper also examine short-run and long-run dynamics of EKC with panel cointegration and panel error correction methods.

Journal

Journal of Economic Studies – Emerald Publishing

Published: Jan 12, 2015

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